AIOFP’s Johnston sledges FAAA’s CFP designation
Amid reports that the Financial Advice Association of Australia has been pressing he case for its Certified Financial Planner (CFP) designation during its joint associations roadshow, the Association of Independently Owned Financial Professionals has sought to question the value of the CFP.
In a message to member, AIOFP director, Peter Johnston has sought to suggest the FAAA’s push on the CFP is aimed at addressing cashflow problems.
While plugging the AIOFP’s designation, Johnston said that “designations are not recognised or cared about by Consumers”.
“Its all about locking in cashflow and appealing to those who want some ‘letters after their name’,” he claimed, stating, “there are better ways to do it in our view”.
“Considering the CFP designated cohort were one of the very few member categories permitted to vote on the merger and FPA management ‘grandfathered’ circa 1,000 of them outside of the CFP rules years ago [as long as they kept paying], hypocrisy is high on the list of the FAAA agenda,” Johnston’s message to member said.
“Besides for NOT being recognised by FASEA/Consumers and the Adviser is essentially handcuffed by not being permitted to take the CFP brand with them if leaving the membership, we cannot see the sense in it.”
Plugging the AIOFP approach, Johnston stated: “Our CFS designation is focussed on consumers, has relevancy, transferrable and more cost effective. It seems a lot to pay for a ‘P’!
{The USA sourced CFP brand cashflow path was adopted by the Australian FPA Chapter in its 1990’s infancy and is no longer relevant in our view.”
“We can only assume FAAA are hoping this CFP cashflow will replace the Banking ‘rivers of gold’ they had become accustomed to living off at the expense of the Advice community and their families.”
As long as FPA/FAAA maintains its defence of the inexcusable “grandfathered” CFP arrangements, it will always be vulnerable to attacks like AIOFP’s. It will always be viewed as hypocritical and inconsistent. It will never be as effective in lobbying the government as it should be. It will always struggle to attract and retain as many genuine professionals as members as it should. And the CFP brand will always be tarnished.
The FPA mantra that “CFP was the highest standard available at the time it was introduced” is utterly disingenuous. The CFP designation gifted to grandfathers in the early days did not require a degree, even though business/economics/finance degrees were readily available at the time, and degrees were a common consumer expectation for all professionals at that time. The FPA excuse brigade commonly trot out comparisons to the early days of accounting and legal professionalisation when degrees and other higher level qualifications weren’t required. But those professions emerged more than 50 years earlier when degrees were not commonplace or widely expected. (A degree did become a CFP requirement after the grandfathers were signed up and locked in).
Similarly the training course required for grandfathered CFPs was at sub degree AQF 6 level. Other professions such as accounting had long ago developed AQF 8/9 level courses for their members, and the ability for financial planning to develop something similar was readily available at the time of CFP introduction. (An AQF 8/9 level CFP course did become a CFP requirement after the grandfathers were signed up and locked in).
And now we have FAAA saying the “experience pathway” should have a 10 year sunset clause, when grandfathered CFPs have been allowed to continue without sunset for over 20 years!!
“Anon’s” view is entireley incorrect. As someone that was intimately involved in the FPA from the late 80’s, I was an “early” CFP that existed under the older program. You are incorrect, there were NO dedicated tertiary level degrees for financial planning at that time. The Deakin DFP was the only program and even that was poo-poo’d by the majority of advisers, saying it was irrelevant. After all, when your performance is assessed purely on how much product you flog, who cares if the advice is correct ? The cap-stone assessment back then was an actual financial plan and annual review. It was peer reviewed by another CFP. It was BLOODY tough. Mine was done by one of the “fathers” of Financial Planning – James Doogue in WA. I failed twice. I might point out that this peer assesment where an experienced practitioner determines if you are any good, is essentially still used in the Medical profession and in Aviation. In the 90’s the “majors” saw the benefit of the CFP brand and encouraged their advisers to get on board. But, given that so many of their planners were failing the assessment, they pressed for change. When you represent thousands of potential new members, you tend to get your own way. The CFP program was broken up into “parts” and you just needed to get through the components. The fact is, I saw pretty incompetent people get their CFP. Under the old rules, they would never have been accpeted. I am sure the standard now is much higher, but just don’t bag things through ignorance. Some of the most respected planners in this country are “old school CFPs”
“Old School CFP” makes an interesting point. When we were required to obtain a PS 146 certificate a decade or so ago I had probably 15 years experience at the time. Integratec, who were issuing certificates, asked for 5 completed advice files, one of which I believe had to be a claim file. Their process involved examining the file from start to finish, looking for reasoning and all the other criteria that are talked about today. I still think it was an excellent process, because it effectively eliminated those “technicians” or brainiacs” who were good at sitting exams, but useless at providing complying advice. And yes to my knowledge that methodology is still used to assess doctors for advancement.
FASEAs ethics exam, where we were purportedly being examined on their capacity to carefully examine ethical & moral dilemmas after a period of contemplation and reflection, asked us to answer 57 questions in 195 minutes – definitely conflicting with the maxim espoused by the proponents of FASEA. To make matters worse, with the questions written by people who have never sat in front of a client in their lives. What a farce!
I might also add; the dominance of the major’s influece led me to quit the FPA and let my CFP lapse. It may be the first time I have ever agreed with anything Peter Johnson has said, but the CFP is a nothing brand these days. Sam Henderson (Royal Commission) made sure of that.
When asked by any of my staff whether they should do the CFP program I tell them no. If you want a truly recognised designation that means something to clients do your Masters. Also after spending thousands of dollars on the CFP program they only way you can keep using the designation is paying $1,000 a year, what a rort. Do your Masters and you have the letters behind your name forever. We already have many advisers in our practice who are letting their membership lapse and don’t care about losing their CFP as no client has ever asked about it.
I totally agree with ‘Researcher’. The FPA totally let down planners right throughout the Royal commission. They sat on their hands for the entire 4-5 yrs and sacrificed the older members of the profession. They failed to criticise the Industry Super Funds who now believe they can provide advice via their trustees after completely attacking the advice Industry and Financial Planners for the past 10 yrs. Their impact was akin to a slap in the face with a wet lettuce.
I did the Masters as I agree with the comments above. The CFP is just a money making scam. However I keep my membership for FPA just so I can keep tabs on their movements and make sure they don’t continue to fuck uop the advice sector any more than they already have.
Let the membership lapse, they need to be sent a message, and you don’t need a membership to keep tabs on them. One thing the AFA/FPA/FAAA/AOIFP etc love is a press release. It makes it seem they are doing something, when is reality they are not.
So AIOFP’s is a valid and consumer centric accreditation and not a cash grab but everyone else’s is? Seems about right from this mob
Peter, while i have always admired your ethusiasm and passion for the profession, your vocal public derision of the FAAA, whether true or not, only encourages legislators and powerbrokers not to take us seriously. One of the standout traits of a profession is the spirit of solidarity among members. It only appears as if your doing the same as what they are being accused of..”you cant trust them, they want the money…come to us (pay our membership fees)..”I dont mean to sound harsh, you are definately a fighter of our constituents needs…but i trully believe you would only be doing the overall profession a disservice in airing your views in this manner.
Angry old white man shakes his fist at cloud……..again.
No need for racism!!
and ageism
Why does the financial services media continue to source Peter Johnston? An organisation that was created to give small practices volume bonuses? It’s a relic of the past – not the future. It’s akin to listening to Pauline Hanson and suggesting it reflects “community values”
Because he is like the Donald Trump of Financial Services. We all know he is a bit crazy but we all still click on it
but is he wrong? I had a choice between a Master’s degree and a CFP. The CFP was a poor substitute and it wasn’t a hard decision to complete the Masters.
Agree. Wealthy professionals know what a Masters Degree is, and they respect financial advisers who have one. A CFP means nothing to people outside of our industry
Clearly this is a fight for the 5%, being those uneducated, and that believe in the good old days of commissions and volume bonuses.
The CFP Brand in Australia is now a sign that your only level of education is DFP 1-8. Advisers with no education pay $1000 a year for three little initials for advertising. It’s been trashed by the FPA’s association with the Royal Commission and an organisation that lost Advisers the ability to self regulate and be a profession. As for Peter Johnston, a dinosaur , that states Advisers with Degrees are not welcomed in “his” association, filling his ranks with those advisers that hung on desperate for the last 5 years hoping they would not have to complete a mere 4-6 units of a course.
Seems to me it’s just a fight over the dregs of the Advice community.
My love for PJ fluctuates between love and hate. These behaviors are not the trait of a leader and a professional. What we’ve got is an opportunist, a person that realized five years after the FASEA event (not before) that at least 10% of those 20,000 advisers would be incredibly bitter about FASEA. Here’s the opportunity. That’s at least 2000 angry new members paying $650 and you’re running costs are next to nothing. Plus an opportunity to travel the world organizing a conference paid by those same people.
The AIOFP throws stones are Advisers with Degrees, they clearly have stated they don’t want to be a professional association, they want to be an industry association. That type of representation dosen’t call for any degree of professionalism or leadership. You can just be an Angry Paul Hansen sensationalist figure and you’ll achieve you’re own personal self-centred objectives.
I’m not saying the FAAA are professional either, and they’d struggle to be an industry association representing Advisers. More focused on their mates at AwareSuper. What the intent of this post is, is to highlight the sad lack of representation Advisers have, and ultimately it’s really just a sad reflection on ourselves where both the Adviser and the consumer pays.